2023-01-31 Finance CommitteeMinutes
FINANCE COMMITTEE SPECIAL MEETING
January 31, 2023
Elected Officials Present Staff Present
Councilmember Diane Buckshnis (Chair) Dave Turley, Administrative Services Director
Councilmember Will Chen Megan Menkveld, Deputy Admin. Serv. Dir.
Councilmember Vivian Olson Scott Passey, City Clerk
Councilmember Susan Paine
Council President Tibbott (joined at 3:38 p.m.)
1. CALL TO ORDER
The Edmonds City Council Special Finance Committee meeting was called to order virtually and in
the City Council Conference Room, 212 – 5th Avenue North, Edmonds, at 3:31 p.m. by
Councilmember Buckshnis.
2. COMMITTEE BUSINESS
1. Risk Management Policy
Questions and discussion followed regarding why this was assigned to HR Director Neill Hoyson, Ms.
Hoyson’s experience with risk management, who is the risk manager referenced in the policy,
reference in the policy to a risk management program, act of God versus act of nature, past review of
the policy by the finance committee, having Lighthouse review the policy after the finance committee
completes their review, purpose of a quarterly report to full council, council’s role in establishing the
policy, WCIA rates based on amount of claims, desire for council oversight of claims, past practice of
a WCIA rep providing an annual recap, concern with having a report made at a council meeting,
whether $5000 is the correct limit for the risk manager to charge off, and having an annual review of
claims during an executive session. Councilmember Buckshnis offered to forward the questions she
sent to Ms. Neill-Hoyson to Councilmember Paine.
Committee recommendation: Reschedule on future finance committee meeting agenda when Ms.
Neill Hoyson is available to attend.
2. ERP and OpenGov Budget Update
Ms. Menkveld reviewed:
• ERP Selection Update
o Project is on-hold
o Eden sunset in 2027
• OpenGov Budget
o Budget configuration is complete
o Currently working through the online budget book
o Interfacing with Eden is next, concurrent with online budget book
o Training – Citywide
o Project Completion: April 2023 (possibly earlier)
• Online budget book
o Template/page creation
o Department participation
o Editing and review
01/31/23 Finance Committee Minutes, Page 2
• Training Hours
• OpenGov University
• Training staff will received:
Questions and discussion followed regarding determining a timeline for ERP, determining which ERP
system the City will use, integrating OpenGov with an ERP system, OpenGov’s ERP system, whether
OpenGov will be live and available to the public by April 2023, how OpenGov will be introduced to the
public, having an OpenGov presentation at a council meeting, budget book information that will be
available via OpenGov on the website, auto update of budget information into OpenGov in the future,
transitioning into an ERP in the future, how long OpenGov has been in business, why IT is not
identified in training hours, training users who will enter information into OpenGov, adding council
executive assistant to OpenGov University, whether each department should have a backup user,
whether the timeline for ERP should be a budget retreat topic, Eden sunsetting in 2027, other cities
who will be seeking a replacement for Eden, and other cities that use OpenGov.
01/31/23 Finance Committee Minutes, Page 3
Committee recommendation: For discussion.
3. Impact of the 2023 Budget on the Strategic Outlook
Questions and discussion followed regarding the footnote on page 22, an alternate footnote proposed
by Councilmember Chen, concern calculations in the budget book do not following the reserve policy,
whether the fund balance policy should be changed to exclude under-expenditure from the
calculation, and the increase in miscellaneous revenues.
Committee recommendation: For discussion.
4. Leak Adjustment Policy
Mr. Turley reviewed proposed updates to the Leak Adjustment Policy:
• What is a Leak Adjustment?
o Occasionally a water customer will discover that their plumbing has a leak. This will cause
higher water usage and a higher water bill. If caught quickly, the additional cost may only
be a few hundred dollars more than normal. Sometimes a leak may be large and go
undetected for several weeks, causing the loss of large amounts of water and increases to
the customer’s water bill of several thousand dollars. The City could just charge the full
amount, but we have tried to provide a way to mitigate this unexpected cost.
o Our current policy is confusing and does not provide for a payment plan after an
adjustment is made. The new policy is easier to understand and compute, provides a
reasonable reduction in the amount of water the customer will be charged for, and provides
for a payment plan.
• Current Policy:
o Under the current policy the customer has to show that they took reasonable steps to fix
the leak as soon as it was discovered. Subject to meeting certain requirements, the City
will do the following:
Compute what their average bill has been and charge them that, then
Forgive up to $1,000 of the excess, then
Take the remainder and bill that amount to them at wholesale, then
Add a 15% administration fee to the wholesale amount.
• Proposal:
o Under the proposed policy the customer still has to show that they took reasonable steps
to fix the leak as soon as it was discovered. Subject to meeting certain requirements, the
City will do the following:
Compute what their average bill has been for the same period during the previous
three years and charge them that usage at retail (currently $4.23 per unit), then
Take the remainder and charge that amount to them at wholesale (currently $1.50 per
unit).
If the final bill is more than $1,000 the customer will have the option of paying the bill in
equal installments of up to 12 months at 0% interest.
Questions and discussion followed regarding support for the proposed policy, whether the $1,000 final
bill could be reduced to $500, who pays for the water that flowed into the library, how often leak bills
occur, and resolution of the large leak bills that occurred last year.
Committee recommendation: Consent Agenda
5. November Monthly Report
Mr. Turley reviewed:
01/31/23 Finance Committee Minutes, Page 4
• General Fund Revenues for 11 months ended November 30 are $87,793 behind budget (2/10
of 1%)
• General Fund Spending for 11 months ended November 30 is $3,897,424 under budget
• Sales Tax Revenues for 11 months ended November 30 are $872,971 ahead of last year, and
$1,161,668 ahead of budget
• Sales Tax Revenues for 12 months ended November 30, by Category
• Real Estate Excise Tax Revenues for 11 months ended November 30 are under budget by
$726,225 (partly due to an accounting change)
• Real Estate Excise Tax Revenues from 2010 - 2022
• Noteworthy items:
o REET revenues are down a total of $(1,366,957) from last year. The decrease for property
taxes and REET is due in part to us having to back the December 2021 SnoCo deposit out
of period 1 2022 and into period 12 of 2021. Since these reports are cash basis, that
adjustment affected it whereas our year-end accruals don’t affect this report. It will be the
same for the monthly report until December of 2022, and then next year won’t be affected
by this. The entry that backed these revenues out of January 2022, decreased REET by
$(242,395).
o Gas Utility Tax is up $60,705 from last year.
o Telephone Utility Tax is down $(74,613) from last year. This is also due in part to timing
differences of when payments for October (we receive the payments for October in
November) were recorded. Most of the October payments were recorded in December.
o Building Structure Permits are up $72,055 from last year. Development Services revenues
overall are up a total of $115,493 from last year.
o Parks & Recreation Program Fees are up $164,975 from last year.
o Total Interest Earnings for all funds are up a total of $138,425 from last year.
01/31/23 Finance Committee Minutes, Page 5
o We have received $250,493 more in interest with the LGIP from this point in time last year.
And we have received $199,054 more in interest with the SCIP from this point in time last
year.
Questions and discussion followed regarding predictions regarding when/if a recession will occur,
reasons that REET revenues are down, effects of housing price bubble, investments in the investment
portfolio, inclusion of unspent ARPA funds in the investment portfolio, amounts invested with the
Snohomish County and the state pools, the City’s investment policy, and utility fund expenditures.
Committee recommendation: Consent Agenda
The following future finance committee agenda items were identified:
• Fund balance policy
• Risk management policy (include HR Director Neill-Hoyson in the discussion)
• 2021 Audit
3. ADJOURN
The meeting was adjourned at 5:02 p.m.
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SCOTT PASSEY, CITY CLERK